North American Free Trade Agreement (NAFTA) Renegotiation

On July 17, the Office of the United States Trade Representative released their report entitled ‘Summary of Objectives for the NAFTA Renegotiation’.  One of the promises made by Candidate Trump was a renegotiation of the North American Free Trade Agreement.  In a tweet from October 2016, Trump said, ‘I will renegotiate NAFTA. If I can’t make a great deal, we’re going to tear it up. We’re going to get this economy running again.’  However, in April 2017, President Trump stepped back from his plan to issue an Executive Order removing the US from NAFTA in favor of renegotiation of the trade deal.  This Summary of Objectives is a result of that decision.

Agriculture plays a large part in the Summary, with cross border agricultural trade being a large part of our import/export activity with Mexico and Canada.

To quote the Summary, ‘The new NAFTA must continue to break down barriers to American exports. This includes the elimination of unfair subsidies, market-distorting practices by state owned enterprises, and burdensome restrictions of intellectual property’.  Among these barriers mentioned were tariffs, price discrimination, regulatory incompatibility, lack of communication and technological capability, verification of country of origin of agricultural products.

Among other areas for renegotiation are: Environmental, Regulatory, Transparency, Labor, Anti-Corruption, and Trade Protection.

In response to the release of the Summary, Michael Dykes, D.V.M., president and CEO of the International Dairy Foods Association, issued the following statement in support of the report, saying “We are pleased to see efforts to address unjustified measures that unfairly limit access to markets for U.S. goods, such as price undercutting, included in the administration’s negotiating objectives. We believe these goals will allow the administration to address Canada’s new milk pricing policy, referred to as Class 7, which has allowed Canadian companies to sell their products below world market prices.

“In addition, we’re pleased to see an objective to expand competitive market opportunities for U.S. agricultural goods by reducing or eliminating tariffs. Canadian tariffs on some U.S. dairy products are nearly 300 percent.”

On the other hand, in testimony before a subcommittee of the Trade Subcommittee of the House Ways & Means Committee on the objectives of the NAFTA renegotiations, Stan Ryan, CEO of Darigold, a large farmer-owned cooperative in Washington State, urged caution.

‘NAFTA has been a driving force behind remarkable growth in dairy exports, and is the reason the United States’ share of Mexico’s dairy imports today is 73 percent.’  He noted that U.S. dairy sales to Mexico have risen to $1.2 billion last year from just $124 million in 1995.  He worried that the preferential tariffs enjoyed by the U.S. could be undermined if the benefits of NAFTA are watered down in renegotiating the dairy provisions of the agreement.

However, Ryan criticized the new Canadian dairy Class 7 system.  “It essentially matches the lowest price in the world for milk protein finished products, despite Canada having one of the world’s highest raw milk farm gate  prices, all operating under a state-controlled and state-protected system.  Common sense to economics would tell you that if it looks and feels like subsidized dumping, it probably is.”

The U.S. Trade Representative announced that seven rounds of NAFTA negotiations will begin August 16.  We will keep you informed of all developments in these talks as they progress.

 

Meet NH State Representative Steve Darrow

Let us introduce Representative Steve Darrow, Vice Chair of the New Hampshire House Committee on Environment and Agriculture, and a first time attendee to the ERC Annual Meeting. Steve is a member of the CSG-ERC Agriculture and Rural Affairs policy committee.

Rep. Darrow has been a resident of NH for forty-five years.  Rep. Darrow has a degree from Franconia College in Literature.  He has been involved in local government, being the current chair of the Pemi-Valley Republican Committee and former selectman from Grafton, NH for twelve years.   In addition, Steve was a member of the school board for his school district, and has been active with the area trail maintenance volunteer group.

Steve was treasurer as well as member of the Board of Directors of the Mascoma Valley Health Initiative. Steve explained that the area in which he lives is very rural, and, because of that, the access to healthcare is limited. The Mascoma Valley Health Initiative is a non-profit organization with the mission of making health care more accessible for local residents, and helps with everything from providing transportation to lobbying for a new local health center.

Representative Darrow is retired from UPS after 28 years, during which time he spent nine years in Sales, nine years in Operations, and finally nine years in Industrial Engineering where he helped UPS become more technologically advanced.

We asked Steve what piece of legislation made him most proud, and he mentioned three things. HR7, which was a resolution that resolved to limit campaign contributions from any entity that will not be ineligible to vote in the next election. Second, he was very proud to vote for relief for NH dairy farmers, which provided $2.1 million to help offset the devastating impacts of 2016’s drought.  And lastly, although not a bill, but Darrow is very proud to sometimes buck the system and vote against the wishes of his party. He prides himself in being able to decide for himself what is best for his constituents.

When asked what he likes most and least about being a representative, Steve responded that he really likes being a part of such an historical body and process. He likes being able to speak up for what he supports or opposes. Steve further commented that he loves the committee work. He further noted that the NH House and Senate has a lot of great people with whom he is proud to serve.  However, he went on to say that he what he disliked the most was the obstructionists in both parties, something he sees as becoming more and more prevalent over the years.

We asked what attracted Steve to the Agriculture Committee, and he said he has always had an interest in agriculture and gardening, and likes being able to promote local agriculture and to support small farms. Since the NH House Committee on Environment and Agriculture also handles solid waste, it further attracted him, since he is a licensed transfer station operator and worries about our disappearing landfill capacity.

We asked Steve what he expected from his first ERC meeting. He said he is looking forward to networking and being able to meet with other legislators, and learning from them what their states’ issues are and what they are doing about them.

Rep. Steve Darrow is just one of the members of the Agriculture and Rural Affairs Policy Committee for ERC coming to the Annual Meeting August 13 through 16 in Uncasville, Connecticut this summer.  Join them by registering at www.csg-erc.org.

Meet the Legislator – MA Senator Anne Gobi

Senator Anne Gobi lives in Spencer, Massachusetts, the town where she was born and raised. After graduating from Worcester State College, Anne studied law at Massachusetts School of Law at night while teaching high school during the day.  After passing the bar, she went into private practice.

A member of the Spencer Democratic Town Committee since 1998, Anne was asked to run for an open seat in 2001.  We asked her if she was anxious about the campaign.  ‘I had never run for anything before this.  The representative in the district before me was a Republican.  Raising money was the hardest part.  I had a primary in my first election, and I had to raise over $50,000 for the campaign, which was hard.  But I won.’  She was a member of the Massachusetts House of Representatives for 14 years, serving on multiple committees including the Joint Committee on Environment, Natural Resources and Agriculture, of which she was co-Chair.

We asked her why she chose go serve on the Agriculture Committee.  ‘In Massachusetts, we have a wish list for committee assignments.  When I was first elected, I was assigned to committees.  But since I grew up active in 4-H and live in a rural district, I wanted to serve on the Agriculture Committee, which I did.  It took me a while to be named chair, but I was, and eventually served two terms as Chair.’  Anne was elected as State Senator in 2014, and she is currently in her second term as Chair of the Senate Ag Committee.

We asked if she likes being a Senator.  ‘I like it, even though there is a lot of work.  Over 300 bills come to my committee during the biennium, and I make sure that the committee works hard on each one.

When we asked what the biggest issue was facing agriculture in Massachusetts today, Anne did not hesitate.  ‘Farm viability.  Massachusetts has 7,000 farms, but most of them are very small.  Last year’s drought affected them badly.  We have to find a way to make farming sustainable for our farmers.’  Another problem with agriculture in the state is the number of outdated laws, particularly the agricultural preservation statutes. The way they were written when people went into them thirty years ago is not the way things are now.  It is a challenge updating laws so that farms can have viability and diversify on their farm so they can survive.  Young farmers need the help most.

Ann said that Massachusetts is losing an alarming number of dairy farms. ‘We’re down to about 160, roughly.  There were thousands at one time.  Within the last ten years we have lost another 25’

She is optimistic with some new trends in agriculture.  ‘Farm breweries are cropping up.  There is a Barre dairy farm that is milking cows and selling beer as well.  One woman who works there said ‘15 cents for a pint of milk, $7 for a pint of beer.’

According to Anne, the biggest non-agriculture issue that the Massachusetts Senate faced this year is the fact that revenues are not coming in at the pace they should be.  Uncertainty on the federal level and the effect that will have is a huge worry.  Health care is almost 51% of the budget.  The state is facing a $870 million deficit.  Currently the state has no tax on online sales.  There should be a way to capture this revenue that has been lost due to the closing of brick and mortar stores in favor of online sales.  Also Massachusetts is home to a large number of financial institutions and service industries that pay no taxes.

Senator Gobi said the thing she likes most about being in the legislature is that it is never boring.  There is a different issue every day.  ‘You never know when the phone rings or when you open an email what is going to be there.’  She likes to keep active, and the legislature helps to provide change and challenge.  What she dislikes most is her long commute to the statehouse, which takes a lot of valuable time out of day.

e says she has enjoyed working and being invited to CSG-ERC meetings and seminars.  She especially likes that she is able to go online and get information on what is happening in other states and in Washington.  This resource is tremendously helpful to her and her staff.

Come and meet Senator Anne Gobi and other dedicated legislators interested in Agricultural and Rural Affairs policy this summer at the 2017 CSG-ERC Annual Meeting in Uncasville, Connecticut (‘Mohegan Sun’) from August 13 through 16.

Trump Signs Executive Order on Agriculture

On April 25, 2017, President Trump signed an Executive Order entitled ‘Promoting Agriculture and Rural Prosperity in America’.

The Order establishes an Interagency Task Force on Agriculture and Rural Prosperity, which will be supported and funded by the Department of Agriculture.  (To read the full text of the Executive Order, click here)

The Task Force will be comprised of 22 members representing the Chairs and Directors of a wide spectrum of government agencies, and will be chaired by the Sonny Perdue, newly-confirmed Secretary of Agriculture.

The stated purpose of the Task Force will be to identify changes in policy, regulations and law that will promote rural America agriculture. Some areas identified for study are increased educational opportunity in rural communities, regionalization of economic development programs, access to reliable workforce, preservation of family farms, improve science-based food safety regulations and policies, encourage exports of agricultural products, advance renewable energy in the rural landscape and expand access to grazing, timber harvesting, mining and recreation on public lands.

The Task Force will be open to recommendations for legislative, regulatory and policy changes from stakeholders, and will produce a report of their findings within 180 days from the date of signing.

We will be briefing members on news of the progress of the Task Force over the next six months.

 

Bob Haefner and Tara Sad
CSG/ERC Agriculture & Rural Affairs Policy Advisors

A First Look at President Trump’s USDA Budget for 2018

Any budget proposal is, by its nature, partisan.   However, we will present the facts as we know them, in a non-partisan manner, and let you decide if you agree or disagree with the budget proposal. We must keep in mind that the President’s budget is merely a proposal. Once the executive branch presents the budget to the US House of Representatives, it is under their control and is no longer the President’s budget. Of course, any President has some influence over what the Congress does with the proposed budget, especially if they are of the same party affiliation. Any proposed budget reflects the priorities of the submitter of that budget. However, we can be assured that, as the budget wends its way through legislative channels, it will take on the priorities of the legislative branch.

That allocation of limited revenue to programs is how we prioritize what is important to a given administration and what makes budgeting a partisan issue. Democrats have different priorities than Republicans, or Libertarians, or even Independents. As the Vice Chair of the NH House Finance Committee often says, “For every one of the thousands of lines in the budget, there is an advocate who says, ‘Cut any line you want except this one’. If you listen to every advocate, you would never cut a penny from the budget.”

Now let’s look at the Trump proposed budget and how it affects the USDA. The proposed budget recommends a 21% cut to total USDA discretionary line items. It does not propose any cuts to mandatory portions of the USDA budget. So the Nutrition Title has not been touched, which includes programs such as the Supplemental Nutritional Assistance Program (SNAP), school lunches and children’s nutrition program. The President’s full proposal is not scheduled to be released until May. Of course, Congress alone can make changes to mandatory spending, since these changes require amending law to affect that part of the budget. This budget proposal really only affects programs that benefit our farmers, and it is the fact that it affects our farmers that makes it critical for   to the Northeast Agriculture Legislators. It is important to note here that this budget proposal came from the White House Budget Director Mulvaney and was not reviewed by the USDA since there was not a confirmation of the nominee at the time.   What impact Secretary Perdue’s involvement in the proposal’s outcome would have had is unknown..

The USDA budget is $155 billion, of which $133 billion (85%) is mandatory spending for nutrition programs and its administration. That leaves $22.6 billion, which is discretionary and allocated for our farm programs. That number had been higher in past years, but between recent sequestrations and cuts from the last administration, it is down to $22.6 billion. The Trump proposal cuts another $4.7 Billion, bringing the discretionary total to $17.9 billion (a 21% cut). The only nutrition program in the $22.6 billion (before the cuts) is WIC. The proposal cuts $150 million from WIC, about half of the previous administration cut of $273 million, based on reduced enrollment due to higher employment numbers. The USDA discretionary spending is one-tenth of 1% of the total federal budget, and yet the USDA has 4,500 offices across the country and territories, and has nearly 100,000 employees spread over 30 different agencies.

So what has been cut in this proposal?  Let’s take a look at what the proposal for the USDA discretionary budget really does based on the information as we have it. ‘Discretionary Spending’ includes Food Safety (meat processing), Rural Development, Conservation, Research Grants, and International Food grants. Cuts do not affect the various insurance programs, such as crop insurance.

International Food Aid  – $200 million

Water and Waste Disposal loans and grants  – $500 million

Rural Business Cooperative Service  – $95 million (duplicative)

Funding for National Forest Service  – No new land purchases

Reduced Staffing  –  All levels

WIC  –  $150 million

In addition, there will be cuts to some statistical services and other areas not yet identified.

While this discussion may be premature considering the many unknowns, we thought it important that we share the information at hand. We will continue to give updates as new data becomes available. In May, the full budget will be rolled out, and our new Secretary of Agriculture and Congress will have their go at the budget. It will be debated by the two parties of the House of Representatives.

In August at the CSG-ERC Annual Conference in Uncasville (Aug. 13-16), and in conference calls starting next month, we will also work as a region to develop a regional position on the Farm Bill, currently in negotiations. This will, of course, affect the following budget cycle. As individual states we are relatively insignificant, but as an eleven-state region, we have 87 members in the US House of Representatives – or 20% of the total votes. So we are not insignificant when we work together.

 

Amid a Spate of Nuclear Plant Closings, State Officials Mull Economic, Environmental Impacts

Nuclear power has long been a mainstay of the Northeast’s energy mix, but a wave of planned retirements has fueled a debate about the fate of aging reactors, and their value to the region’s economy as states work to achieve a variety of energy and climate goals.

In New York and Connecticut, independent analyses have shown that if nuclear plants were to close prematurely, much of the replacement power would come from the burning of fossil fuels, because it would be impossible to ramp up enough wind and solar generation to offset the electricity, at least in the near-term. That would lead to an increase in emissions of carbon and other pollutants, making it challenging to meet states’ climate objectives.

The studies advise that discussions around the future role of nuclear power consider a full accounting of the avoided costs of carbon-free generation compared with fossil fuels – to consumers, the environment and public health.

New York’s Policy

Last year, New York regulators assessed those costs before they approved subsidies to help the James A. FitzPatrick, R.E. Ginna and Nine Mile Point nuclear plants, located upstate. The plants were considering closing because of stagnant energy demand, and fierce competition with rock-bottom natural gas prices in interstate energy markets. Audrey Zibelman, chairwoman of the New York Public Service Commission, told The New York Times last August that the social and economic benefits of New York’s program — including reduction of carbon emissions, lower prices for electricity and jobs in the power-generation industry — would be much greater than the cost to ratepayers, which state officials estimate will total less than $2 a month.

The reactors provide more than 3,300 megawatts of power combined, some 15% of the state’s electricity output. They also supply 61% of the state’s carbon-free generation, and if they shut down, their power would be primarily replaced with natural-gas generation, according to an analysis from The Brattle Group.

Zibelman said the resulting rise in emissions would detract from Gov. Andrew Cuomo’s goal of cutting carbon emissions 40% below 1990 levels by 2030, and 80% by 2050. The economic toll would be high, too: consumers would be expected to pay $15 billion more in electricity prices over the next ten years, and the costs to the environment and human health from increased emissions of carbon dioxide, sulfur dioxide, nitrogen-oxides and particulates would total an estimated $736 million.

The New York policy and a similar one that would help two struggling plants in Illinois is opposed by electric generators, who made two filings at the Federal Energy Regulatory Commission (FERC) arguing the subsidies distort and undermine wholesale power markets.

Elsewhere in the Northeast, the Vermont Yankee plant retired in 2014, and two more reactors are scheduled to close in 2019, nearly a decade or more before their scheduled license expirations: Entergy Corporation’s Pilgrim plant in eastern Massachusetts, and Exelon’s Oyster Creek plant in eastern New Jersey.

Legislative Efforts in Connecticut: Assessing the Avoided Costs of Carbon-Free Power

In Connecticut, which gets 60% of its power from the 2,111-megawatt Millstone Nuclear Power Station, state lawmakers are debating a proactive strategy to ensure the plant stays in operation in the coming years.

Although Millstone’s owner, Dominion Energy, has not announced plans to close, lawmakers are considering a measure that would enable the plant to compete in a state renewable energy procurement program, as a way to lock in long-term power prices for a portion of its output. Proponents stress the bill’s intent is to enhance affordability for ratepayers, and guarantee a continued supply of zero-emission power to help the state meet its target of reducing greenhouse gas emissions 80% below 1990 levels by 2050. Millstone provides 98% of Connecticut’s carbon-free electricity.

Instead of offering subsidies to support nuclear output as New York and Illinois have done, the bill’s sponsors have made it clear that their approach is market based, and is intended to encourage the growth of renewables, too.

The legislation, which passed the joint Energy and Technology Committee last week, would enable the plant to secure long-term contracts for nearly half of its output, avoiding the volatility of daily wholesale power markets. Millstone had been insulating itself from the highs and lows of the spot market by selling energy through a series of futures contracts that run for three years. But the daily market is so volatile that the futures market has faltered, the Connecticut Mirror reported last year. Company officials have said the bill will lead to lower electricity prices for consumers.

The proposal has led to a heated debate in Connecticut, with opposition coming from petroleum industry, consumer advocates, and environmental groups worried that allowing nuclear power to compete in a market reserved for renewables will undercut prices for wind, solar and other emerging energy sources, just as natural gas prices have undercut nuclear power.

But the version that was voted out of the Energy and Technology Committee included language specifically intended to prevent cheaper nuclear power from jeopardizing the state’s growing clean-energy industry. The bill would enable Millstone to sell 950 megawatts of power – a little less than half its total output — through a state-run bid process, but limits its contract to five years. That compares with the 20-year contracts permitted for renewable generation. The legislation specifies that Millstone’s proposal must be in the “best interest of ratepayers.”

The bill also calls for an escalation of clean-energy development. It would extend, for at least one more year, the state’s popular zero-emissions (ZREC) and low-emissions (LREC) programs, which offer incentives for the deployment of distributed generation through a competitive reverse auction. In addition, it ramps up the state’s clean-energy mandate, requiring that by 2040, the state obtain 40% of its power from renewables, which is double the 2020 goal. Lawmakers are still negotiating to add some additional renewables “encouragers” as well, said Rep. Lonnie Reed, House chair of the Energy and Technology Committee.

Their thinking is that encouraging Millstone to keep running, at least in the near-term, would avoid an increase in emissions from fossil fuel generation while new capacity comes online from solar installations, wind turbines, fuel cells and other sources. Reed said that if Millstone were to shut down, there is a real danger that duel-fuel natural gas and oil plants would be built to replace the reactor’s massive output in order to meet Connecticut’s and New England’s electricity capacity needs. Those plants can be constructed much faster than the equivalent capacity from renewable generation, for a variety of reasons, but they emit carbon and other pollutants.

“Gas plants are ISO New England’s back-up plan, since air quality is not their mandate,” said Reed, referring to the nonprofit entity that oversees the region’s wholesale electricity markets. “Reliability and capacity are.”

Studies show that if Millstone were to close in the near future, consumers would pay more.

According to a report last year from the Analysis Group, a private economics consulting firm, if Millstone remains open until its operating license runs out in 2030, consumers throughout New England will reap $6.2 billion in net benefits. That includes an average $500 in annual savings for residential electricity customers in Connecticut over the next thirteen years, and $1.5 billion in avoided costs to the region’s wholesale electric capacity markets.

Conversely, if Millstone were to close prematurely, average consumer electricity prices would be 21% higher by 2030. Replacing the plant’s power over the short-term would require a mix of existing and new natural gas generation, both from in-state generators and in the region. That would stress the local natural gas markets, which supply heat and industrial fuels in addition to electricity, and lift costs.

Emissions of greenhouse gases and other pollutants would rise, too. The carbon-dioxide pollution avoided through Millstone’s operations is roughly equivalent to taking nearly 470,000 passenger cars from the road each year. Early retirement of the plant would boost greenhouse-gas emissions by 2.2 million metric tons annually, some 33%, making it challenging for the state to meet its climate targets. Nitrogen-oxide pollution would increase 38%, thus contributing to worsening air quality.

While the research did not quantify the economic impacts from higher emissions, a number of studies have shown that avoided pollution leads to improved health and economic outcomes for society, because fewer air-pollution-related illnesses means less money spent on medical treatments and lower absenteeism among American workers.

The report’s authors note that their analysis was based on conservative assumptions. They assumed that Connecticut and the other New England states will be able to fully meet their current energy and climate goals, in terms of adding increasing supplies of renewable energy. That includes contracting for hydroelectric imports from Canada from the Northern Pass electric transmission project by June 2020, though the project has yet to receive state and federal approvals. Additional supplies of renewables would make the economy more energy efficient, and thereby mitigate natural gas price increases, the report explains.

“But if natural gas prices spike higher than expected, if there’s slower than hoped-for progress in other things you’re doing in your transition, then the value to Connecticut customers is larger” if Millstone remains in operation, said Sue Tierney, senior advisor at the Analysis Group, during a televised hearing on January 24 in Hartford.

Those who favor policies to keep the region’s nuclear plants up and running observe that concerns about rising emissions in New England aren’t hypothetical. In 2015, the year after the Vermont Yankee nuclear plant closed, the region saw emissions rise for the first time in five years, The Boston Globe reported.

“I wasn’t a particular fan of nuclear plants, but I feel they are so important for affordability of a decarbonization strategy that I think it’s important to tell this economic story: That it’s good for consumers, that it’s good for avoiding global warming to think about keeping these safely operating plants online as much as you can,” said Tierney during her testimony. “And to rely on market based principles as a way to get there…to focus on the power of competition.”

A Question of Priorities

Many of those engaging in the policy debate over the future of the region’s nuclear fleet emphasize that it is a question of priorities, and choosing from an imperfect set of options. There are safety issues associated with nuclear power, and costs surrounding the storage of nuclear waste, which is being held in pools and dry casks on the site of the nation’s 99 commercial reactors, given the lack of a national long-term repository for spent fuel.    

Some environmentalists insist that it is possible to address climate change without nuclear power, by promoting an energy mix based on wind, solar, hydroelectricity and storage. They point to officials’ aggressive push to accelerate clean-energy development in a number of states.

In Massachusetts, where the 680-megawatt Pilgrim Nuclear Power Station is set to shut down in two years’ time, officials are hoping to dramatically increase imports of Canadian hydroelectric power, and take advantage of the nascent offshore wind industry here. Last year, Gov. Charlie Baker signed legislation requiring utilities to procure 1,600 megawatts of electricity from offshore wind in a little over ten years, enough energy to power half a million homes. The law also calls on the state to competitively solicit long-term contracts of up to 20 years to procure 1,200 megawatts of hydropower or other renewable resources, and authorizes the state to secure an energy-storage procurement goal.

More than half a dozen transmission lines have been proposed to bring lower-cost Canadian hydropower into New England and New York state, though so far, only one has obtained all of the required siting permits, a proposed 1,000-megawatt cross-border transmission line known as the Clean Power Link.

In New York, officials’ approval of subsidies for the three upstate nuclear plants contrasts with Gov. Cuomo’s recent announcement of a deal to close the Indian Point Nuclear Plant, located less than 30 miles north of Midtown Manhattan, a decade ahead of schedule. Cuomo has said his administration has identified replacement sources of power for the plant, including offshore wind, hydroelectricity and efficiency.  Cuomo has set a target for the state to get half of its power from renewables by 2030.

Others have argued that given the short window of time to available to address climate change in order to avoid devastating global impacts, nuclear power must play a critical role. “The key time frame for mitigating the climate crisis is the next decade or so,” warns a 2013 study  from James Hansen at the NASA Goddard Institute for Space Studies and Columbia Earth Institute. The research calculated that global nuclear power has prevented an average of 1.84 million air pollution-related deaths that would have resulted from fossil-fuel burning, and avoided 64 gigatonnes of carbon-dioxide-equivalent greenhouse gas emissions.

In Connecticut, Rep. Reed said it should be possible to include nuclear power in a strategy to help renewables thrive.

She noted that two of the largest grid-scale renewables projects built in Connecticut in recent years were financed by Dominion Energy, Millstone’s owner:  a 14.6-megawatt fuel-cell project on a brownfield in Bridgeport, and a 5-megawatt solar array on a farmer’s field in Somers.

“I see the potential to create some more intelligent synergies that allow Dominion to help grow our renewables capacity, while also receiving the economic certainty they are looking for to keep Millstone around and churning out our baseload zero-carbon electricity until our renewables are ready for prime time here in New England, where siting anything is a nightmare,” said Reed.

 “We need a realistic transitional plan,” she added. “This requires thinking outside the usual rigid silos that seem to accompany energy industry planning.”

What are the President’s Funding Priorities for Education?

Looking at the President’s 2018 Budget, we are able to see the Administration’s priorities in education.  Note the newly proposed funding for school choice and charter schools and the elimination or reduction of funding for several other education programs and initiatives.

The President’s 2018 Budget provides $59 billion in discretionary funding for the U.S. Department of Education, a $9 billion or 13 percent reduction below the 2017 annualized continuing resolution (CR) level.

The President’s 2018 Budget for the U.S. Department of Education:

  • Increases investments in public and private school choice by $1.4 billion compared to the 2017 annualized CR level, ramping up to an annual total of $20 billion, and an estimated $100 billion including matching state and local funds.
  • This additional investment in 2018 includes a $168 million increase for charter schools, $250 million for a new private school choice program, and a $1 billion increase for Title I, dedicated to encouraging districts to adopt a system of student based budgeting and open enrollment that enables federal, state, and local funding to follow the student to the public school of his or her choice.
  • Maintains approximately $13 billion in funding for IDEA programs to support students with special education needs.
  • Eliminates the $2.4 billion Supporting Effective Instruction State Grants program.
  • Eliminates the 21st Century Community Learning Centers program, which supports before and after-school programs as well as summer programs, resulting in savings of $1.2 billion from the 2017 annualized CR level.
  • Eliminates the Federal Supplemental Educational Opportunity Grant program.
  • Maintains Pell Grant program by level funding the discretionary appropriation while proposing a cancellation of $3.9 billion from unobligated carryover funding. Note that while Pell Grant funding would not go down, that $3.9 billion would not be available under the President’s Budget.
  • Maintains $492 million in funding for programs that serve high percentages of minority students.
  • Reduces Federal Work-Study significantly.
  • Provides $808 million for the Federal TRIO Programs and $219 million for GEAR UP, funds continuation awards only, pending the completion of an upcoming rigorous evaluation of a portion of the program. The plan reduces funding for these programs by $193 million.
  • Eliminates or reduces over 20 categorical programs including Striving Readers, Teacher Quality Partnership, Impact Aid Support Payments for Federal Property, and International Education programs.

 

Workforce Development: 5 Things to Know

Workforce Development: 5 Things to Know

1.   Employment and Training Administration (ETA) Publishes Guidance on Registered Apprenticeship Provisions and Opportunities in the Workforce Innovation and Opportunity Act (WIOA) for States

Registered Apprenticeship is an important workforce development strategy that the workforce system provides to its customers, both job seekers and employers. It is an evidence-based model for job seekers and is a job-driven strategy for employers and industries. Engagement with employers, institutions of higher education, and policy makers has ramped up significantly in order to achieve the administration’s goal to double the number of apprentices across the United States. This is an historic opportunity for the workforce system to expand its business base and offer job seekers greater employment prospects while offering employers a strategic approach to talent development.

The Employment and Training Administration has published Training and Employment Guidance Letter 13-16 (TEGL).   The purpose of this TEGL is to provide information about the new provisions for Registered Apprenticeship in WIOA, including the status of Registered Apprenticeship sponsors as Eligible Training Providers, membership on State and Local Workforce Boards, the use of WIOA funding to support Registered Apprenticeship, reporting on Registered Apprenticeship activity, and suggestions about how to coordinate with the Registered Apprenticeship system.

Attachment I – References

Attachment II – Making Registered Apprenticeship Work: Case Studies on Workforce-Registered Apprenticeship Partnerships from Detroit and Arizona

Attachment III – How to Count Registered Apprenticeship in the Workforce System

2.  ETA Releases Planning Estimate for WIOA Youth, Adult, and Dislocated worker Program Allotments for Program Year 2017

The ETA has transmitted to states and outlying areas estimated funding levels for Workforce Innovation and Opportunity Title I, Adult, and Dislocated Worker Program Allotments for program year 2017.

Training and Employment Guidance Letter 14-16 (TEGL) conveys the funding levels.  The TEGL provides additional background, funding levels for the allotment estimates, and the formula data.

3.  US Department of Labor Awards $65 Million to Help Unemployed Workers with Job Searches, Support Integrity of the Unemployment Insurance Program

The US Department of Labor’s Employment and Training Administration awarded $65 million to 52 state workforce agencies, including Puerto Rico, the Virgin Islands and the District of Columbia, to operate Reemployment Services and Eligibility Assessment (RESEA) programs for unemployment insurance beneficiaries on January 13th.

The funding will allow states to continue operating their RESEA programs through April 2017. Upon receipt of a full year’s appropriation for 2017, ETA expects to provide additional funding to administer these programs through December 2017.      

The funds will be used to conduct in-person assessments in American Job Centers. The assessments include:

  • Developing an individual re-employment plan for each claimant selected for services.
  • Providing career and labor market information to inform their job search.
  • Help developed job skills and employment prospects.
  • Customizing reemployment services.
  • Review the claimant’s continued eligibility for UI benefits.
  • List of Funds Awarded to ERC members:
    • Connecticut $838,222
    • Delaware $265,318
    • Maine $720,716
    • Maryland $689,745
    • Massachusetts $3,387,820
    • New Hampshire $754,155
    • New Jersey $1,063,379
    • New York $11,215,399
    • Pennsylvania $830,840
    • Puerto Rico $165,018
    • Vermont $403,240
    • Rhode Island $641,101
    • Virgin Island $120,949

News Release / Target Populations / History of Investments / Listing of Awardees / Evaluation / Research

4.   State Science & Technology Institute (SSTI) Examines Governors’ State of the State and Inaugural Addresses for References to TBED, Education, and Workforce Development

Since its inception in 1996, the State Science & Technology Institute (SSTI) has developed a nationwide network of practitioners and policymakers dedicated to improving the economy through science, technology, innovation and entrepreneurship. SSTI conducts research on common performance standards, identifies best practices, analyzes trends in and policies affecting tech-based economic development, and fosters greater cooperation among and between all public, private and nonprofit organizations encouraging prosperity.

Early in each calendar year, SSTI presents excerpts from the State of the State and inaugural addresses by the nation’s Governors. The first round of synopses addressing technology-based economic development (TBED), education and workforce development references was released today (January 12).   Next week the SSTI Digest will continue with Part II of “Tech Talkin’ Govs” featuring news from the next round of addresses. 

Click here for the summaries.

5.   JPMorgan Chase and CCSSO Announce $20 Million to Improve Career Education for Young People in 10 States

The Council of Chief State School Officers (CCSSO) and JPMorgan Chase & Co.  announced $20 million in grants to 10 U.S. states to dramatically increase the number of students who graduate from high school prepared for careers. Developed as part of JPMorgan Chase’s $75 million global New Skills for Youth initiative, each winning state will work with government, business and education leaders to strengthen career education and create pathways to economic success.

These 10 states demonstrated the strongest plans to work across sectors to transform how they design and develop career preparedness education programs and provide young people with the skills they need to compete for high-skill, well-paying jobs. They have also committed to bring together education leaders, business partners and community partners to set ambitious benchmarks for achieving these goals.

Too many students leave high school without being prepared for college or a career. Nationwide, the unemployment rate for young people ages 16-24 is 9.3 percent, with many more working only part-time or in low-wage jobs with little opportunity to advance. At the same time, the U.S. economy is projected to produce millions of well-paying jobs over the next decade, about two-thirds of which will require some post-secondary education but not necessarily a four-year college degree.

For all states, this is an opportunity to work across sectors and pull together stakeholders in business, industry, higher education and within communities to research what has worked and what career pathways are most needed for kids in their state.

These state grants are one part of the $75 million, five-year New Skills for Youth initiative developed by JPMorgan Chase, in collaboration with CCSSO, Advance CTE and Education Strategy Group, aimed at strengthening career-focused education starting in high school and ending with postsecondary degrees or credentials aligned with high-skill jobs. In recent years, more than 40 states have committed to transforming career education for all students. In March 2016, JPMorgan Chase and CCSSO awarded $100,000 grants to 24 states and the District of Columbia for planning and early implementation of long-term career readiness education programs that align with the needs of area employers. These states received targeted coaching and support to begin implementing these programs over the past year.

Testimonials from Governors and other State officials

NY Gov. Cuomo Announces Deal to Close Indian Point Nuclear Plant

The Indian Point Nuclear Plant will close in four years, more than a decade ahead of schedule, a deal that “eliminates a major risk” to the safety of New Yorkers, Gov. Andrew Cuomo announced in his State of the State address in Lower Manhattan on Monday.

The plant is located less than 30 miles from Midtown Manhattan, and Cuomo has long advocated for its closure, noting that in the event of an accident, evacuation would be all but impossible for the more than 20 million people who reside in New York City and its surrounding areas. 

“New York City sits 30 miles from a ticking time bomb,” said Cuomo during the address. “This agreement eliminates a major risk, and provides welcome relief. New Yorkers can sleep a little better.”

The deal between the state and Entergy, the plant’s operator, calls for the reactor to shut down by April 2021, fourteen years ahead of schedule. An Entergy official told the The New York Times the company had assented to closing the plant early because cheap, abundant natural gas had made nuclear power less profitable.

Some industry sources questioned how the state would replace the 2,000 megawatts of power produced by the plant, which supplies about a quarter of the electricity used by New York City and Westchester County, while meeting the state’s carbon-reduction goals and its requirement that utilities get half of their power from renewable sources by 2030. Some experts expressed skepticism that the power could be replaced without relying on large quantities of natural gas.

Cuomo said the state had identified replacement sources of power for Indian Point, including investing in renewable energy.

The governor has prioritized investments in renewables as part of his administration’s energy-system overhaul, Reforming the Energy Vision, or REV, which was launched in 2014. The state has established a number of incentive programs and financing vehicles, including a 10-year, $5 billion Clean Energy Fund and a $1 billion New York Green Bank, a state-sponsored entity that was launched to partner with private-sector lenders to support renewable-energy projects.

New York has also pledged to lower its carbon emissions 40% below 1990 levels by 2030, and 80% by 2050. The state participates in the nine-state Regional Greenhouse Gas Initiative (RGGI), which caps emissions from large power plants. In his address on Monday, Cuomo said that New York would reduce its RGGI cap by 30% by 2030.

In a statement on the Indian Point closure plan that provides some details on replacement power options, the governor said that transmission upgrades and efficiency measures have already produced over 700 megawatts of power, and that several new sources of generation are fully permitted and readily available to come online by 2021, after the plant’s closure, including up to 1,000 megawatts of hydropower.

In his speech, Cuomo specifically mentioned plans to invest in offshore wind, and to add new transmission lines to deliver large quantities of hydropower from Québec.

Here is a brief overview of efforts related to those energy sources in New York, and elsewhere in the region.

Offshore Wind

Cuomo is among several officials in the Northeast who have been working to establish a thriving offshore wind industry here, though the sector is in its infancy in the U.S., with only one project currently in operation, a 30-megawatt pilot off the coast of Block Island, Rhode Island. That project went online in December. Although other projects are in the early stages of development up and down the Eastern Seaboard, it is expected to take several years, or even a decade or more, for a utility-scale wind farm to be built and operational in U.S. waters. Still, New York is among several east-coast states that are forging policies to attract the massive supply chain that is critical to supporting a robust offshore wind industry here. 

The Cuomo administration is developing an Offshore Wind Master Plan, expected to be released this year. Officials are studying a 16,740-square-mile area of the ocean, from the south shore of Long Island and New York City to the continental shelf break, for potential future sites for offshore wind, according to a report released last year. The report found that offshore breezes along the state’s Atlantic coastline could produce enough electricity to power 15 million homes. Last July, Cuomo announced his support for a proposed 90-megawatt wind farm 30 miles east of Montauk, which would provide power to the South Fork of Long Island. In December, Statoil provided the winning bid in the federal government’s online lease sale of more than 79,000 acres in another offshore wind area, some 14 to 30 miles off the New York coast. The lease grants the company the rights to explore the potential development of an offshore wind farm to supply power to New York City and Long Island. In a press release, Statoil said the area could potentially accommodate turbines producing up to 1 gigawatt of power.

Hydropower

More than half a dozen transmission lines have been proposed to bring lower-cost Canadian hydropower into New England and New York state, but so far, only one has obtained all of the required siting permits, a proposed 1,000-megawatt cross-border transmission line known as the Clean Power Link. 

The project is a 154-mile underground transmission line that that is being developed with private-sector financing by TDI New England. It will originate at the U.S.-Canadian border, and extend some 154 miles under Lake Champlain, to Ludlow, Vermont, the company said in a statement last month.

Sean Klimczak, senior managing director of Blackstone group, the project’s lead investor, said the approval makes the company well positioned to respond to Massachusetts’ upcoming clean-energy solicitation for 1,200 megawatts of base load hydropower and onshore wind, according to the statement. Legislation approved by the Massachusetts Legislature last year requires the state to solicit long-term contracts of up to 20 years to procure 1,200 megawatts of hydropower or other renewable resources, and 1,600 megawatts of offshore wind power.

TDI is developing another project, the $2.2 billion Champlain Hudson Power Express, which would bring up to 1,000 megawatts of hydropower to the New York City metropolitan area. As proposed, the line would be buried along railroad right-of-ways and under waterways, including Lake Champlain and parts of the Hudson River.

Cuomo’s address on Monday, which was held at the World Trade Center in New York City, was one of six planned State of the State speeches that the governor will deliver across New York this week.

You can watch Monday’s address here.